06 - Credit Adjustments

1. Vendor Credits (Purchase Side)

Purpose: Used when you return goods to a vendor, or when the vendor issues a refund or price adjustment.

Typical Scenarios:

• You return damaged or excess stock

• Vendor overcharges or gives post-invoice discount

• You made an overpayment

Steps to Create:

1. Go to Vendor Credits or open a Purchase Invoice and click "Create Vendor Credits".
   

2. Enter:

   • Vendor name

   • Credit Date

   • Reference Bill (optional)

   • Item/amount details

3. Save and Post.

How It Works:

• Can be applied against unpaid Vendor Bills.

• Reduces your overall liability to the vendor.

• Reflected in Accounts Payable balance.

2. Credit Notes (Sales Side)

Purpose: Issued when a customer returns goods or you give a post-sale price adjustment or refund.

Typical Scenarios:

• Customer returns damaged goods

• Overbilling or correction after invoice sent

• Promotional refund/discount

Steps to Create:

1. Go to Credit Notes or open a Sales Invoice and click "Create Credit Note".
   

2. Enter:

   • Customer details

   • Return items or amount

   • Credit Note Date and reference invoice

3. Save and Post.

How It Works:

• Reduces Accounts Receivable for the customer.

• Can be applied to future invoices or refunded.

Visibility

• Vendor Credits and Credit Notes are shown separately in reports.

• Net payable and receivable positions reflect these credits dynamically.

• You can track unallocated credits from vendor or customer views.